COBRA Coverage for Unemployed Workers – Cost and Coverage

Health Insurance While You’re Unemployed

COBRA Benefits and COBRA Subsidy

Among the list of worries you have when you’ve been laid-off is how you will maintain your health insurance coverage. The very term COBRA strikes fear in the heart of any suddenly unemployed worker. You imagine hundreds of dollars each month being sucked out of your dwindling checking account just to keep basic medical coverage for you and for your family.

  • How much does COBRA cost?
  • Can I get information on the COBRA subsidy for unemployed workers?
  • How long does COBRA coverage last while I’m looking for an affordable health insurance plan?

COBRA Coverage

COBRA is temporary extension of your employer’s group healthcare benefits in the event you are laid-off or separated from your job. When your employer’s healthcare coverage ends you may then elect to begin COBRA coverage under the same provider. Difference is, you pay all of the premium.

Your company’s plan administrator will set-up the benefits program for you. Good news is you do have what’s called an “election period” during which you may weigh the pros and cons to COBRA coverage, even change your mind one way or the other about it. The length of election period varies depending upon how quickly your plan administrator notifies the healthcare provider, etc., but you could have a couple months in which to decide if you can afford COBRA coverage.

COBRA benefits typically extend your healthcare coverage for up to 18 months following cessation of your job benefits.

Are you eligible for COBRA benefits?

If you’ve been laid off from a job where your employer has covered you under a group health plan for 20 or more employees you are likely eligible to elect COBRA coverage for yourself, your spouse and/or dependent children.

What if you worked for a small business with less than 20 employees on a group healthcare plan? Are you unqualified for COBRA? Not if your state has created its own Mini-COBRA clause. Find out more about the State Mini-COBRAs or continuation of coverage programs that ensure everyone is eligible to elect extended healthcare coverage.


When you elect to continue COBRA insurance coverage you assume the full cost of the monthly premium. You are also responsible for an initial retroactive premium payment—you owe the amount past due on any outstanding coverage since your regular benefits ended, or that paid by your former employer. That can be a big wallop to your pocketbook.

COBRA is a temporary, but expensive, fix. There are other lower cost healthcare insurance options.

Recent COBRA Subsidy for Unemployed Workers

Part of President Obama’s recent aggressive strategy to provide relief to the throngs of laid-off American workers was the American Recovery and Reinvestment Act. Part of this Act has included a COBRA subsidy for eligible benefits members.

  • How do you qualify for the COBRA subsidy from the government?
  • Will it help make COBRA an affordable option?

Under the new COBRA subsidy, the federal government will cover 65% of your COBRA premiums under the following conditions:

  • You are laid off from work between September 1, 2008 and December 31, 2009
  • Were covered by your employer’s group coverage when separated from your job.
  • You elect to continue COBRA coverage and pay the monthly premiums.

For more detailed information you should contact your healthcare plan administrator.

Recommended Resources:

U.S. Department of Labor COBRA Continuation Program

U.S. Department of Labor COBRA Continuation Act under the American Recovery and Reinvestment Act of 2009


# cathy 2011-04-21 16:48
I see cobra payment went up in monthly cost. From 116.00 a person to $418.00 a person. And 1, 119 for a family of 3. Wow why has it tripled so suddenly ?Thanks for answering my question! Cathy
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# Melanie 2011-11-29 10:42
For the last 6 months i worked in PA. Prior to that I was laid off from an employer that I worked for in NJ from 6/09-11/10. I did not collect unemployment from this employer because i resigned. Can I collect unemployment?

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# Betty R 2012-08-20 18:13
I had to relocate from Alaska to Oregon for my husband's medical. My Cobra payments are 1,601.00 per month - much more than my unemployment. I don't qualify for assistance from Oregon, my family is going in the hole each month financially. How do we get any assistance? I haven't found a job and Oregon has a bunch of programs for people drawing unemployment from Oregon, but not for people drawing from other states. I can't find any government program to help with my Cobra either.
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# shi sha 2013-01-12 07:34
I was just fired due to the fact that I had to take Family leave for a condition/illness that would not allow me to go back to my work station and unit although I was at work when I had a stroke
and seizure(never had a seizure in my entire life before) I was
not permitted by my Mgr to work with the assistance of a cane
in my assigned unit as I was told that my unit no longer was able to accomodate such devices in this particular unit. So,after
12weeks of family leave I am now out of the door; not sure how to pay for COBRA(they quoted me $490.00 amonths) this just happened a vew days ago; I will be 60 in march 2013,am single/divorced for 20 years-have had no paycheck since 10/24/12 and awaiting my paperwork to file for unemployment--what can I do? I am also now a new diabetic and also have lower limb neuropathy. God help me.
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# Earl 2013-02-04 16:24
I believe I am up for terminaton on my job I have 30 yrs of employment. Would it be wise to resign or allow the company to terminalte employment and recieve unemployment until I find other work.
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# jay 2013-02-04 20:34
2 part question. Like many i was laid off in 2007 and I did not think I could collect unemployment because I had a small part time job even though it paid only 40 a week. I kept it hoping it would lead to a full time job with the company.

I went on cobra and used all my saving to pay it over the next 18 months. This was before the govt was helping people pay for cobra.
I was able to find a part time job as a school bus driver but with private ins now I am broke paying the health ins.

My questions are this

is there anything I can do about not filing for unemployment back then retroactive or is there anything I can do about all the money I spent for my wife and myself on cobra. also is there anything I can do now about tax credits for my healthcare thank you
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# Michelle 2017-08-25 08:39
I have been terminated from my job of 21 years~healthcar e facility so health insurance was a great benefit. Now sitting here with no insurance~what are my options~I have met my deductible so is it wise to carry the cobra insurance my exemployer offers and is there any assistance with that as I have heard the Cobra is very expensive!! Thank you!!
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